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Do investment firms look for businesses or for people with ideas for a new type of business that they could finance?

2006-08-17 03:45:31 · 5 answers · asked by goldminerone 1 in Business & Finance Investing

5 answers

Not really. Venture capitalists want way more than an idea. At the very least, you should have a professional management team (not necessarily committed to the company full-time at present, but ready for such commitment should venture capital funding materialize), a prototype of your product/service and/or the results of a concept test, a patentability opinion from an experienced patent attorney (if applicable), and a business plan that can convincingly show how you and your team can create a multi-million dollar business in three to seven years.

Note also that most venture capitalists prefer to invest in large transactions (some start at $5 million, some even at $20 million). The implications are twofold. First, you should have a management team that has experience managing multi-million dollar projects. Second, you should be aiming to create a company that would be valued in tens or hundreds millions of dollars within a few years.

2006-08-17 05:49:46 · answer #1 · answered by NC 7 · 0 1

Generally Venture Capitialists will fund existing small businesses, but at a cost. Existing corporations rarely hear ideas from outsiders.
Good Luck with your idea!

2006-08-17 03:54:49 · answer #2 · answered by kcincon 3 · 0 0

Yes.

First step is a good, well written business plan.

If you don't have one, you're not ready.

I would want to know what kind of a return I could make on my investment and in how long and with what risks.

I prefer to see three scenarios, a pessimistic, optimistic and middle of the road.

2006-08-17 03:53:33 · answer #3 · answered by SillyQuestion 3 · 0 0

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2016-09-29 09:06:19 · answer #4 · answered by ? 4 · 0 0

Yes. They're usually called venture capital firms.

2006-08-17 03:53:51 · answer #5 · answered by ? 2 · 0 0

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